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MAI Scheme: Incentivising exports in a new avatar

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The industry is very positive about the revisions introduced to MAI Scheme expects accelerated export growth as a result By Usha Sharma

The Indian pharma sector has registered exports growth rate in double digits in the first quarter of the current fiscal after nearly three years. The future too seems bright for growth as the Union Ministry of Commerce and Industry has recently revised the provisions of the ‘Market Access Initiative (MAI) Scheme.

The MAI Scheme which was already in existence provides reimbursement of expenditure incurred by exporters on statutory compliance in the export market/nation. The scheme also avails other benefits like Marketing Projects Abroad, Capacity Building in specific nation/ countries, support for statutory compliance, different studies related to market, export surveys, studies related to evolving WTO compatible strategy, project development and for the development of foreign trade facilitation web portal. All these benefits already provide considerable assistance to Indian exporters. Then, what is the rationale behind the launch of the revised MAI Scheme for pharma exporters? And, what are its benefits?

Revised MAI Scheme and new components

As per the latest order issued by the government, it has raised the ceiling to Rs 2 crore a year per exporter from existing Rs 50 lakh. Under the new guidelines, any exporting company can claim reimbursement incurred towards statutory compliances on a 50:50 sharing basis up to a maximum amount of Rs 2 crore in a year. The revised MAI Scheme is already under effect.
A major component which was included in para 4.2 (8) of the MAI Scheme, in an order by the Ministry of Commerce and Industry, Government of India on January 7, 2019, mentions that within the overall limit of assistance, per exporter will be benefited with revised provision contained in MAI. The new components include plant inspection charges for pharma products incurred by small scale exporters on bar-coding of export consignments (This would be a one-time grant to defray actual expenditure limited to a maximum of Rs 25 lakh per exporter).

This new feature will give access to pharma exporters to enter markets which were far-fetched due to heavy inspection charges. Besides these other components, exporters are paid fees for quality certification required for natural products (Herbal, Ayush products, Dietary supplements, nutraceuticals), reimbursement of registration charges in respect of cosmetic products, data generation/ letter of access cost, including study cost, data purchase cost, research on existing data, data evaluation cost, consultancy cost, study monitoring cost, etc, for chemicals/agro chemicals/ cosmetic products and testing charges in respect of testing done in India for export of engineering products. The other provisions of the scheme remain unchanged. All these newly added components in the existing MAI schemes have been well appreciated by the pharma industry. Here is what some of the stakeholders have to say about it.

It is an exporter-friendly initiative – Satish Wagh

Reimbursement of plant inspection charges will be very useful – SV Veerramani

MAI scheme amendments to benefit pharma exporters – Bhavin Mehta

MAI revision will help SMEs in implementing bar-coding of export consignment – Nipun Jain

MAI revised policy will help CRAMs players to observe double digit growth – Sandipan Mandal

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